Correlation Between GRIFFIN MINING and Occidental Petroleum
Can any of the company-specific risk be diversified away by investing in both GRIFFIN MINING and Occidental Petroleum at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining GRIFFIN MINING and Occidental Petroleum into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between GRIFFIN MINING LTD and Occidental Petroleum, you can compare the effects of market volatilities on GRIFFIN MINING and Occidental Petroleum and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in GRIFFIN MINING with a short position of Occidental Petroleum. Check out your portfolio center. Please also check ongoing floating volatility patterns of GRIFFIN MINING and Occidental Petroleum.
Diversification Opportunities for GRIFFIN MINING and Occidental Petroleum
0.39 | Correlation Coefficient |
Weak diversification
The 3 months correlation between GRIFFIN and Occidental is 0.39. Overlapping area represents the amount of risk that can be diversified away by holding GRIFFIN MINING LTD and Occidental Petroleum in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Occidental Petroleum and GRIFFIN MINING is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on GRIFFIN MINING LTD are associated (or correlated) with Occidental Petroleum. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Occidental Petroleum has no effect on the direction of GRIFFIN MINING i.e., GRIFFIN MINING and Occidental Petroleum go up and down completely randomly.
Pair Corralation between GRIFFIN MINING and Occidental Petroleum
Assuming the 90 days horizon GRIFFIN MINING LTD is expected to generate about the same return on investment as Occidental Petroleum. But, GRIFFIN MINING LTD is 1.15 times less risky than Occidental Petroleum. It trades about -0.05 of its potential returns per unit of risk. Occidental Petroleum is currently generating about -0.04 per unit of risk. If you would invest 4,665 in Occidental Petroleum on September 14, 2024 and sell it today you would lose (83.00) from holding Occidental Petroleum or give up 1.78% of portfolio value over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
GRIFFIN MINING LTD vs. Occidental Petroleum
Performance |
| Timeline |
| GRIFFIN MINING LTD |
| Occidental Petroleum |
GRIFFIN MINING and Occidental Petroleum Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with GRIFFIN MINING and Occidental Petroleum
The main advantage of trading using opposite GRIFFIN MINING and Occidental Petroleum positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if GRIFFIN MINING position performs unexpectedly, Occidental Petroleum can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Occidental Petroleum will offset losses from the drop in Occidental Petroleum's long position.| GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc | GRIFFIN MINING vs. Apple Inc |
| Occidental Petroleum vs. MCEWEN MINING INC | Occidental Petroleum vs. Zijin Mining Group | Occidental Petroleum vs. Harmony Gold Mining | Occidental Petroleum vs. EIDESVIK OFFSHORE NK |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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